Conditions and procedures for suspension of investment projects in Vietnam

Conditions and procedures for suspension of investment projects in Vietnam (Internet image)

Regarding this issue, LawNet would like to answer as follows:

1. What is investment project?

According to Clause 4, Article 3 of the Law on Investment 2020, investment project means a collection of proposals for the expenditure of mid-term or long-term capital to carry out investment activities in a particular administrative division over a certain period of time.

2. Conditions and procedures for suspension of investment projects in Vietnam

Conditions and procedures for suspension of investment projects in Vietnam according to Article 56 of Decree 31/2021/ND-CP are as follows:

- An investment project shall be suspended in the cases specified in Clauses 1, 2 and 3 Article 47 of the Law on Investment 2020.

+ When suspending an investment project, the investor must notify the investment registration authority in writing.

If the project has to be suspended in a force majeure event, the State shall allow the investor to be exempt from paying land rents or reduce land levies for the suspension period with a view to remedy consequences caused by the force majeure event.

+ The investment authority shall decide to suspend an investment project in part or in full in the following cases:

++ To protect sites/monuments, relics, antiques or national treasures in accordance with the Law on Cultural Heritage;

++ To rectify a violation of the law on environmental protection at the request of the environment authority;

++ To take measures to ensure occupational safety at the request of the labor authority;

++ Pursuant to a judgment or decision of a court or an arbitral award;

++ The investor fails to adhere to the written approval for investment guidelines or the investment registration certificate and recommits administrative violations after incurring penalties.

+ The Prime Minister of Vietnam shall decide to suspend a project in part or in full if the project execution is detrimental or potentially detrimental to national defense and security at the request of the Ministry of Planning and Investment.

- The total period of suspension of an investment project shall not exceed 12 months.

 If the investment project is suspended according to a court’s effective judgment or decision, effective arbitral award or investment authority’s decision, the suspension period shall be determined according to the court’s judgment or decision, effective arbitral award or investment authority’s decision. 

If these documents do not specify the suspension period, the total suspension period shall not exceed the period prescribed in this Clause.

- Suspension procedures are as follows:

+ If the investor decides to suspend the investment project himself/herself/itself as prescribed in Clause 1 Article 47 of the Law on Investment, such investor shall send a notification to the investment registration authority within 05 working days from the date of making the decision.

The investment registration authority shall receive the notification and notify the project suspension to relevant authorities;

+ If the investment authority decides to suspend the investment project, such authority shall, according to the competent authorities’ opinions about the cases specified in Clause 2 Article 47 of the Law on Investment 2020 to decide to suspend part or whole of the investment project and notify relevant authorities and investor.

The investment authority or competent authorities in the fields specified in Points a, b, c and dd Clause 2 Article 47 of the Law on Investment 2020 shall make a record prior to deciding to suspend or suspend part of the investment project.

Where the investment project is suspended according to the court’s judgment or decision or arbitral award, the investment authority shall, according to the court’s effective judgment or decision or effective arbitral award, decide to suspend part or whole of the investment project;

+ Regarding an investment project that is detrimental or potentially detrimental to the national defense and security, the provincial People’s Committee shall send a written notification to the Ministry of Planning and Investment.

The notification shall contain the following contents: the investor executing the project; objectives, locations and contents of the project, process of executing the project; assessment of impacts or potential impacts of the project on national defense and security; proposal that part or whole of the project is suspended.

At the request of the provincial People's Committee, the Ministry of Planning and Investment shall seek opinions of the Ministry of National Defense and Ministry of Public Security for submission thereof to the Prime Minister for decision to suspend part or whole of the project.

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